They could be awful at recognizing them and only invest when founders show up with a box pooping out bars of gold already, and not at any point before then, since they're so awful at recognizing them.
so you can have a 100% success rate (investing only in founders that show up with a box already pooping bars of gold) while having a 0% ability to identify successful founders.
a high hit rate does not mean you can evaluate founders correctly.
If they keep growing into bigger boxes pooping gold, then you've done a pretty good job as an investor. It's all about IRR; if you invest and your investment grows, it doesn't matter what stage you invest at.
Keep in mind that for every Series C company that's pooping gold bars still 90% will fail, and a lot of investors are gonna lose money investing at that stage.
of course, I said "100% success rate", under the scenario I sketched they're great investors. I just showed that this doesn't mean they can recognize the cadre of people who have what it takes. They could be 100% successful while having 0% ability to recognize anyone whose boxes aren't pooping gold yet.
Genuinely curious if your choice to group those investment firms is intended to imply something about them - such as they generally work together/compete with each other, belong to the same tier, etc.
>Benchmark Capital has a pretty small number of bets, and a pretty high hit rate, from my perspective. They certainly seem better at picking than most.
Of course some investors have better results than others. That would happen if they were all choosing to invest or not at random.
Though I'd say a lot of that is of course positive selection - the best founders self-select to Benchmark/Sequoia/A16Z, and to Greylock/Accel.